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14th Congress Central Committee Third Plenary Session statement

26 February 2018, Kempton Park

The SACP 14th Congress Central Committee held its Third Plenary Session on the 23rd and 24th February in Ekurhuleni. The meeting occurred against the immediate backdrop of significant, rapid developments in our country - notably the forced resignation of President Zuma on 12th February in the face of an imminent parliamentary vote of no confidence, and the election of Deputy President Cyril Ramaphosa as President of the Republic three days later.

Notwithstanding the rapidity of these and many other related developments, the orderly manner in which they have unfolded are a testament both to the strength of our post-apartheid Constitutional order as well as the determined wave of popular and patriotic isolation of those involved in the corporate capture and looting of strategic state institutions.

The Central Committee (CC) noted the important role the SACP has played over an extended period, initially as the only organised formation within the ANC-headed alliance, in identifying and naming "state capture", and in demanding the ANC recall of President Zuma. It was the SACP that first called for a judicial commission of inquiry into "state capture". In May last year the SACP convened a National Imbizo (Consultative Conference) that drew together participants from, amongst others, Congress of South African Trade Unions (Cosatu), the South African National Civics Organisation (Sanco), the African National Congress (ANC) stalwarts and veterans, Business Leadership South Africa, Save South Africa, and various community and faith-based formations.

The National Imbizo adopted a minimum platform of action. The CC noted that, without exception, all of the issues highlighted in this platform have either been met or steps towards implementation have now been undertaken. They include the appointment of an independent judicial commission; the dissolution of the Eskom Board and the reversal of the irregular re-appointment of the Eskom CEO; moves to end the factional abuse of the criminal justice system; growing parliamentary activism; and President Ramaphosa`s commitment to set up an inquiry into the South African Receiver of Revenue (SARS), and lifestyle audits for politicians in the executive. There are also clear indications that an unaffordable and unneeded nuclear deal will not go ahead. Of course, ongoing vigilance on all of these fronts is still required.

Areas that require specific attention include the intelligence services, broader security cluster and SARS. The SACP urges the President to establish the announced Commission on SARS as soon as possible. Among the issues it should investigate are the SARS management`s handling of the allegations against Jonas Makwakwa and Kelly-Ann Elskie and the disbandment of the SARS High Risk Investigations Unit. The exodus of senior staff should also be examined.

The SACP commends President Ramaphosa for the leadership role he has now openly assumed in driving the anti-state capture agenda with energy and focus. The parasitic networks are off-balance and some leading personalities are, literally, on the run. Now is the time to press ahead unsparingly.

However, it is no secret that, while President Ramaphosa`s election as ANC president in December has been a key factor in tilting the balance, that election was won with the slimmest of margins. Key levers of public power and leadership structures at various levels are still loaded with personalities historically implicated in "state capture" networks. A reconstructed and revitalised criminal justice system must be allowed to pursue its responsibilities. A false closing of ranks, a phony ceasefire in the name of ANC "unity" ahead of the 2019 general elections will betray our struggle and will, in fact, be rejected at a popular level, not least by the ANC`s own historical support base.

It is in this context that the SACP has called for a reconfiguration of the ANC-headed alliance. Without the support of its alliance partners, the progressive energies for renewal now evident will be compromised and stymied from inside of the ANC itself. There are organisational practices and emerging class forces that have allowed this 106-year liberation organisation, our ANC, to become the entry-point for the parasitic looting of public resources. These practices and forces have not disappeared. The SACP intends to actively engage the ANC and our other allies on interventions that must now be urgently undertaken to address systemic problems at both the national and sub-national levels, within our movement and within the state.

The CC reaffirmed the perspectives contained in the Party`s initial response to last week`s Budget. The SACP acknowledges that this budget occurs within a very challenging situation, not least a nearly R50bn fiscal deficit, and a public debt that is simply unsustainable over the medium term. It is a debt which threatens to undermine any latitude for sovereign developmental policy implementation. Demagogic and populist responses to the budget should, therefore, be avoided.

Much (by some estimates around half) of the deficit is directly attributable to the parasitic looting of public resources by the state capture phenomenon. South Africans, particularly the working class and the poor are having to bear the brunt of austerity measures precipitated by this parasitic looting.

In particular, the SACP is extremely unhappy with the increase of VAT. It marks the possible beginnings of regressive creep. While some basic foodstuffs are zero rated, the working class and poor do not live on bread and pap alone. It is simply untrue to argue, as the Minister of Finance did, that the 20 per cent poorest will be unaffected by the VAT hike. What is more, other indirect taxes, like the increase in the fuel levy, will further impact on the cost of living especially for the poor.

Overall, the macro-economic impact of the VAT increase will dampen demand, impact on GDP growth, and have negative implications for employment creation.

We note the higher than inflation increases in social grants which were announced as a compensatory measure. Apart from the extremely modest impact these increases will actually have, there is a deeper, longer-term structural concern.

In essence, the Budget is reaching for a social compact with the poor - increased social grant payments in exchange for increased VAT. This runs counter to the underlying logic of President Ramaphosa`s State of the Nation Address (Sona) address in which stimulating the productive economy - whether through industrialisation, infrastructure development, land reform or leveraging investment into job creating activity - is the critical point of emphasis. The implicit logic of the social grant for VAT deal is the perpetuation of a welfarist and not active developmental approach.

The SACP will be campaigning to ensure that by the time of the next budget, the VAT increase will be rolled back and other measures found to address the deficit including active recovery of billions of stolen capital, rigorous measures to address tax base erosion and illegal capital flight, and a wealth tax. While the current budget may buy us some relief from further ratings downgrades, there is little in it that places us on a sustained trajectory to address the real structural problems in our society.

The SACP welcomes the SONA announcements of three major real economy points of focus - a Jobs Summit, stakeholder consultations focused on driving serious land reform, and a Financial Sector Summit. The real macro-economic crisis in our economy is sustained crisis-levels of unemployment, close to 40 per cent and well over 50 per cent in the case of youth. Which is why the Jobs Summit cannot just focus on micro-economic interventions, an effective alignment of macro-economic policies with the objective of achieving inclusive, job-creating growth is imperative. South Africa needs increased investment in the productive sector of the economy as opposed to a financial sector that is fuelling and supporting consumption and consumerism.

On the land question, the SACP welcomes what we believe to be the real intent behind the ANC`s December conference resolution on "expropriation without compensation" as one lever to achieve land reform. While we do not believe that the existing constitutional requirement of paying just and equitable (not market) compensation has remotely been an impediment to serious land reform - in fact, the Constitutional right to expropriate in the public interest has NEVER been used for land restitution! Nonetheless, the opening up of this issue presents an important opportunity to move land reform in post-apartheid South Africa out of its current confused and spineless dead-end. In general, the SACP aligns itself with the findings and recommendations of the High Level Panel chaired by former President Kgalema Motlanthe on the land question. There has not been serious budgeting for effective and productive land reform. The focus has been on necessary but limited land RESTITUTION, at the expense of forward-looking land REDISTRIBUTION and security of tenure, especially for those (mainly women) often living under patriarchal arbitrary subjection in the former Bantustans, and farm-workers on commercial farms. The land question has also tended to be focused on rural areas with the critical challenge of radical transformation in urban areas where the property market now reproduces and exacerbates apartheid space with as much cruelty as forced removals and the old Group Areas legislation once did.

As a lead formation in spurring the convening of the first the National Economic Development and Labour Council (Nedlac) Financial Sector Summit in 2002, the SACP welcomes the announcement that the much delayed second summit will now be convened in the coming months. The 2002 Summit and the resulting 2004 Financial Sector Charter paved the way for some important advances in terms of debt relief, and greater transparency and regulatory control over the Credit Bureaus. However, many other agreements have not been seriously implemented, notably commitments to community reinvestment measures. Meanwhile, campaigns and court judgments have uncovered serious abuses in the issuing of garnishee orders, in housing evictions, and the abuse of grant recipients by Cash Paymaster Services and others. There is a general crisis of unsustainable indebtedness among the working poor and middle strata as a result of predatory credit offers by retailers and others. The implosion of Steinhoff is also not unrelated to attempts to disguise the true state of its local debt book through off-shoring and foreign acquisitions.

Working with our allies, the SACP will use the Financial Sector Summit, amongst other things, to press for a thorough review of implementation of agreements embodied in the Charter, for interest rate caps for industrial credit and the gap housing market. We will also call for the more effective consolidation of development finance institutions (DFIs), not least a string of provincial DFIs including Eastern Cape Development Corporation (ECDC), Free State Development Corporation (FSDC), Limpopo Economic Development Enterprise (Limdev) and Ithala. The Postbank must be effectively launched and its role in social grants disbursement consolidated.

Overall, the CC concluded that while welcoming and fully supporting the now intensified offensive against "state capture", we must also ensure that we do not imagine that a return to a pre-2009, pre-Zuma era is either possible or desirable. We must use the momentum of struggle against parasitic looting to press ahead with real (not demagogic) radical structural transformation of our economy and society. We need to be forward looking, move decisively ahead and boldly implement a second, more radical phase of the national democratic revolution, by also nudging all progressive forces in this direction.

As the SACP`s 14th National Congress in July last year resolved, driving these imperatives will now require, amongst other things, the consolidation of a networked left progressive front of formations. The building of a popular left front together with the reconfiguration of the alliance form the central tenets of the Congress` resolution on state and popular power, and the SACP is forging ahead with its implementation. To this end the SACP will be deepening consultation and engagements with our allies, worker and other progressive formations.

The CC condemned in the strongest terms possible the criminal attack on and killing of police officers at eNgcobo police station in the Eastern Cape last week, and expressed serious concern about what seems to be a trend of increasing lawlessness in some parts of our country. The SACP conveys its heartfelt condolences to the families of the five members of the police service, Constables Sibongiseni Sandlana, Kuhle Mathetha, Nkosiphendulo Pongco and Zuko Ntsheku, warrant officer Zuko Mbini, and the soldier Mbuzeni Freddy Mpandeni. Our heartfelt condolences also go to the Police and Prisons Civil Rights Unions to which all the members of the police belonged, and to the police fraternity as a whole. The SACP calls on communities to mobilise and work together with the police to fight against the scourge of crime.

ISSUED BY THE SOUTH AFRICAN COMMUNIST PARTY | SACP

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